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The government’s effort to get people to voluntarily disclose their black money, under the Income Declaration Scheme ( IDS), has had a tepid response, with only about ? 4,000 crore reported till mid- August. The four- month window for disclosing black money deposits will close at the end of this month. The informal target for the scheme was tax collection of Rs. 40,000- 50,000 crore. To collect that amount, the disclosure would have have to be about Rs. 1 lakh crore. Those availing of this scheme would have to pay 45 per cent of their disclosed amount as tax, penalty and cess. Sources said the government expected to see an upsurge in the rate of disclosures in the last two weeks. “The scheme has been slow to pick up, with only about Rs. 4,000 crore black money disclosure till mid- August. But, we expect higher volumes as the deadline approaches,” said a government official. He added: “ This was the trend we had seen in the foreign black money scheme last year.” Another offici

FinMin proposal involves merging rail & general budgets and advancing its presentation in Parliament to January from February end The finance ministry will shortly move a cabinet note on a multidimensional recast of the budget that's set to mark a break with the past.The proposal involves merging the rail budget with the general budget and advancings its presentation in Parliament to January from February end. If cabinet endorses the plan, a January budget will also see no distinction between plan and non-plan expenditure. And, if finance minister Arun Jaitley does succeed in getting the goods and services tax (GST) rolled out on April 1, revenues will take on a vastly different look, with the budget process being tweaked accordingly. An internal government panel has backed the idea of doing away with a separate railway budget, a 92-year-old practice that dates back to the colonial era. The panel will suggest how this can be achieved. “The proposal will be moved short

END OF ZERO-TAX REGIME FOR FDI VIA MAURITIUS ROUTE Tax department questions benefit claims of investors' nominees Foreign investors using Mauritius to bet on Indian stocks are already beginning to feel the end of a zero-tax regime. The tax office has started questioning the claims of their nominees -special purpose vehicles and entities floated in the tax haven -for tax benefit. In the course of recent arguments before the authority of advance ruling (AAR), the counsels of the tax department have challenged the Mauritius structures of at least four foreign private equity and strategic investors. What has surprised these investors and their legal advisers is the aggressive stance of the Income Tax department even though the General AntiAvoidance Rule (GAAR) comes into effect next April, three persons familiar with the development told ET. Now, here are the new rules and the provisions of the changed treaty between India and Mauritius: capital gains on equity shares bought af

The Income-Tax Investigation Commission formed just after World War II was the first disclosure scheme while the penultimate was the controversial Voluntary Disclosure of Income Scheme of 1998. The aim of IDS 2016 is not to garner taxes but to make Indian businesses compliant with the new reality -a transparent balance sheet. You cannot get a bank loan or persuade an investor to invest in your business unless you can show them an asset which you aim to exploit. IDS has an element of penalty. It does not put a habitually honest tax payer in a disadvantageous position vis-à-vis a newly honest tax payer. You declare your undisclosed income in Form No1. Your jurisdictional PCITCIT determines your tax liability and sends you a computation of the tax that you have to pay in Form No2. After paying the tax, you have to send Form No.3 and the PCITCIT would issue you an Immunity Certificate in Form No.4, which you can produce if any scrutiny or prosecution is contemplated in respect of the

India can create several Walmarts of its own, commerce and industry minister Nirmala Sitharaman said on Wednesday, highlighting India's potential while reiterating that the country is not yet ready to open up multibrand retail to foreign investment. “We haven't reached competition where there will be a level playing field if it (multi-brand retail) were to be opened up,“ Sitharaman said at `India Summit' organised by the Economist newspaper. In reply to a question on why India has not permitted foreign direct investment (FDI) in multibrand retail trade, the minister said, “We welcome anybody...but if some way this dialogue is moving towards why not (FDI in) multi-brand retail in India? My answer is, `not yet'.“ India allows foreign companies to invest only up to 51% in multi-brand retail while it has removed the cap on single-brand retail. The ru ling BJP has been opposed to the idea of opening up the sector because it believes such a move will hurt small, indep

Ask consultants to conduct comparative analysis on six countries for investments Foreign portfolio investors (FPIs) in India have been scrambling to find safe tax havens ever since Mauritius lost its pole position after India's renegotiations around capital gains and may have finally zeroed in on six destinations where they can register their pooling vehicles. FPIs are looking at France, Spain, and Denmark, and to some extent even Netherlands, where they can register their investment vehicles before they pump money in Indian equities. On the other hand Ireland and Luxembourg seem promising for locations from where debt investments can be made in India. Top FPIs have roped in tax consultants in India to conduct a comparative analysis of these destinations. As of now France and Spain seem to be on top of the list for many , say people close to the development. It could take anywhere between 6 months to about a year for these FPIs to start investing from one of the new countri

The Advertising Standards Council of India (ASCI), an apex body that works on the principle of self- regulation in the sector, could soon have powers to check misleading ads across media and segments under the proposed new Consumer Protection Act, 2016. The parliamentary committee, which looked into the Bill, had recommended this earlier. Sources told Business Standard the government is considering the proposal before the Bill is presented in Parliament in the winter session. At present, ASCI has powers only for television advertisements. In case an advertiser violates its code — detailed guidelines on advertising — it is asked to modify the aberrant advertisement. If the advertiser does not comply, the matter is referred to the Union information and broadcasting ministry, which takes penal action. Under the changes proposed in the Bill, ASCI will be a partner of the Consumer Protection Authority ( CPA), a nodal body. ASCI will keep track of advertisements in all media and as